Which of the Following Methods of Amortization Is Normally Used

question 47

Multiple Choice

Which of the following methods of amortization is normally used for intangible assets?

• A)Capital cost allowance
• B)Straight-line
• C)Activity method
• D)Double declining-balance

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Definitions:

Adjusting Entry

An accounting entry made into a journal at the end of an accounting period to allocate income and expenditure to the appropriate periods.

Interest Payable

A liability account showing the amount of interest expense that has been incurred but not yet paid.

Nominal Interest Rate

The stated interest rate of an investment or loan without accounting for inflation or compounding interest effects.

Nominal Interest Rate

The stated interest rate on a loan or financial instrument, not accounting for inflation or other factors that affect the real interest rate.